The provider of People’s Pension has called for Government, regulators and the pensions industry to work together at pace to deliver the new Value for Money (VfM) framework, warning that the sector is short on time to implement reforms which will deliver better outcomes for millions of pension savers.
Responding to the latest consultation on the framework, People’s Partnership, which provides the People’s Pension to 7.2 million people, said getting VfM right will be critical not only to improving outcomes for savers, but also to supporting the Government’s ambitions to unlock greater productive investment from pension schemes. If schemes are to invest more for the long term and play a greater role in supporting UK economic growth, they need clarity over how investment performance and value will be assessed under the new regime.
The organisation, which operates without shareholders, welcomed the Government’s ambition to introduce a consistent way of assessing the value delivered by workplace pensions, but said significant work remains to give schemes the regulatory and technical certainty they need. Without that clarity, schemes will find it harder both to prepare for implementation and to make long-term investment decisions with confidence.
The provider said the revised timetable is achievable, but only if Government and regulators work closely with industry over the coming months. It is calling for regulations and supporting technical requirements to be developed in parallel, alongside a clear roadmap setting out what schemes will need to do and by when. Providing that certainty quickly will be essential if the Government is to deliver both a workable VfM framework and its wider ambitions for pension capital to support productive investment and UK growth.
Patrick Heath-Lay CBE, CEO of People’s Partnership, said:
“The Value for Money framework will bring the change the pensions industry needs and will support delivery of better outcomes for millions of savers – but we don’t have long to ensure it does. There is a lot of work to do to give schemes the clarity they need to build, test, and implement the changes in time. The only viable approach is for government, regulators, and industry to work in genuine partnership and at pace.
“This is vital not only to ensure the VfM framework can get off the ground as intended, but also to realise the Government’s plans around productive investment. If we want pension schemes to play a greater role in driving the UK economy through long-term investment – and we do – they need the confidence to make those investment decisions with a clear understanding of how they will be assessed. Getting that clarity in place quickly will be crucial.”
Notes to Editors:
- People’s Pension is the largest commercial master trust in the UK based on members, serving seven million pension savers across the UK and managing £45bn in assets. It is provided by People’s Partnership, a business without shareholders, it reinvests its profits with the aim to help customers and achieve better financial outcomes for everyone. This assessment is determined by membership size. People’s Pension currently has more than seven million members, which, according to publicly available industry data, exceeds the membership of any other commercial master trust.